Insurance underwriter Old Republic International Corp. (ORI) on Thursday reported a net loss for the first quarter compared to a profit in the year-ago period, reflecting relatively flat profitability at the company's general insurance business and a wider loss at the company's mortgage guaranty segment. However, revenues increased 21 percent and beat analysts' estimates.
The Chicago-based company's net loss for the first quarter was $12.9 million or $0.05 per share compared to net income of $25.0 million or $0.11 per share in the year-ago period.
Net operating loss for the quarter was $17.1 million or $0.07 per share compared with net operating income of $23.1 million or $0.10 per share in the same period last year. On average, five analysts polled by Thomson Reuters expected the company to earn $0.06 per share for the quarter. Analysts' estimates typically exclude one-time items.
Operating revenues grew to $1.12 billion from $929.6 million in the year-ago period and topped analysts' consensus estimate of $1.07 billion. The higher revenues include the company's acquisition of PMA Capital Corp in October 2010.
Of the total revenues, net premiums and fees earned rose 20 percent to $1.00 billion, while net investment income declined 4.9 percent to $91.5 million. Net realized investment gains in the quarter were $6.4 million, up from $2.9 million in the same period last year.
The company's general insurance segment, its biggest arm, recorded a 1.1 percent decline in operating profit to $68.5 million despite a 31 percent increase in revenue to $625.5 million.
Operating loss at the mortgage-guaranty business widened to $101.1 million from $34.1 million in the year-ago period on an 18 percent decline in revenues to $131.2 million. Claim costs at the segment rose 22.7 percent.
The Title insurance segment reported an operating income of $2.6 million compared to operating loss of $8.6 million in the same period last year. Revenues grew 30 percent to $339.9 million.
Old Republic's benefits and claim ratio was 63.8 percent compared with 59.6 percent in the year-ago period.
In Thursday's regular trading, ORI is trading at $12.76, down $0.31 or 2.37 percent on a volume of 0.84 million shares.
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